Every Government Grant You Need To Know As A First Home Buyer In Victoria
In This Week’s How's The Market | Edition 70
Every Government Grant You Need To Know As A First Home Buyer In Victoria
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Every Government Grant You Need To Know As A First Home Buyer In Victoria
Buying your first home isn’t easy in any state or territory within Australia, so when the government creates grants and concessions specifically to help first-home buyers, we think it’s information you should definitely be across.
In this article, we are going to break down the basics of 6 schemes you’re eligible for as a first-home buyer in Victoria.
Starting with, what we believe, is the best concession available…
Stamp Duty Concession
First Home Buyers are exempt from paying stamp duty up to $600,000 & tampered stamp duty up to $750,000. For off-the-plan purchases you will only pay stamp duty for the land component of the property. Land-only purchases are also eligible.
Examples of stamp duty payable at the following purchase prices:
$600k purchase price: $0
Non-First-Home Buyer: $31,070.00
$650k purchase price: $11,356.00
Non-First-Home Buyer: $34,070.00
$700k purchase price: $24,713.00
Non-First-Home Buyer: $37,070.00
$750k purchase price: $40,070.00
Non-First-Home Buyer: $40,070.00
$10,000 Government Grant
First Home Buyers purchasing off-the-plan, newly constructed or house & land packages are eligible for a $10,000 Government Grant. You must live in the property for at least 12 months upon completion. The $10,000 will also form part of your deposit.
First Home Guarantee Scheme
This allows purchases to avoid paying Lender's Mortgage Insurance (LMI) when purchasing a property with less than a 20% deposit. The purchasers must have 5% in genuine savings to qualify. This is available for purchases up to $850,000 with new or existing property. You must also make less than $125,000 p.a individually or $200,000 as a couple.
First Family Home Guarantee Scheme
This scheme allows single parents or guardians to avoid paying LMI when purchasing a property with less than a 20% deposit. You must have 2% in genuine savings. This is available for purchases up to $850,000 with new or existing property. The applicant must make less than $125,000 p.a.
This is also available for those that are not first-home buyers and have previously owned property.
To qualify, you must prove that you currently do not own an interest in any property via any means.
Victorian Home Buyer Fund
With this scheme, the Victorian Government will contribute up to 25% of the purchase price of the property. This amount must be paid back including any accumulated equity within the government's share, either at the time of sale, or if you no longer qualify for the scheme. E.g if you start to earn over the minimum income thresholds.
The applicant must have 5% in genuine savings. This is available for purchases up to $950,000 with new or existing property. You must make less than $125,000 p.a or $200,000 for couples.
This scheme is a little more complicated than some of the above and has more terms and conditions. We do believe this scheme can be a great avenue for first-home buyers to take in order to get into a better property faster.
Not only do you need to save less of a deposit, but you also pay less in your repayments by the amount the government owns. For example, if they contribute 25%, your monthly repayments will also be 25% less for as long as they have a stake in the property.
You are able to buy them out at any time and can even refinance and take out equity in the future and use that to buy them out.
There are terms and conditions about when you can make an offer, which banks allow this scheme and what you are able to do to the home once you live in it as you need the government's permission to make any improvements valued at over $10,000.
For more information, listen to the podcast version of this article.
First Home Super Saver Scheme
First-home buyers can opt to contribute up to $15,000 per year ($50,000 in total) in additional super contributions towards the purchase of their first home. Again you must occupy the property for at least 6 months within the first 12 months of ownership. You must also not have previously owned a property in Australia.
These schemes can make the difference between buying a home this year or in 4 years time for some, and for the reason that they can stack on top of one another, they can enable a first home buyer to get into the market sooner and for less!
What The Agents Are Saying
7 Weeks Until Christmas!!
As more properties hit the market, we are starting to see a separation between the in-demand markets and those that are starting to suffer from the increase in stock.
Agents in the Boorondara & Stonnington Local Government Areas (LGAs) have reported this week a slow down in numbers at open homes in the apartment market as more stock has hit the portals.
We are actively looking within those regions and I am now starting to receive calls from agents asking if we are going to be coming back through any properties or make offers, even after I have indicated we have no interest.
Many agents have told me we are the only interested party on a few of the properties that have been online for a few weeks.
Heading up to the north in Brunswick, however, is a different story.
On the weekend I inspected a small unit and had to line up behind at least 50 other buyers as the demand was so high. This unit did appear to be underquoted substantially which may be what has drawn the attention.
Agents in the inner city markets selling houses have reported a slower increase in stock than expected which has kept demand high.
The Wow Factor!
26 Kooyongkoot Road, Hawthorn, Vic 3122
One of Melbourne's best houses on one of its best streets.
An impressive Victorian landmark family estate.
Designed in 1886 and recently renovated, this period home comes with grand proportions.
Check it out via satellite view and you will see that nearly every neighbour on this street has a pool and full sized tennis court.
Sometimes your neighbours properties count as a wow factor too!
Price guide: $17,000,000 - $18,000,000
In The Media
What Australia's booming population means for housing
One of the most spoken-about topics in the economy and real estate market at the moment is net overseas migrations.
We know that the forecasted numbers for the next few years are well above long term averages, though does this really correlate to house price growth?
This article shows graphs that determine a positive correlation between population growth and house price growth and states that while there are many more factors that ultimately effect the market, net overseas migration is one of the factors that can contribute to house price growth.
Final Thoughts
Being a first-home buyer is tough.
That’s why it is so important to understand every additional resource available to you.
I hope this article has helped you to understand the basics and inspires you to research some of the above grants and concessions further.
Thanks for reading this far!
We value feedback and if you have any suggestions on what you would like covered in the future please email me at tristan@tomii.com.au
Happy Buying!
Note: This is general advice and does not take into consideration your objectives, situations or needs. Please consider if this advice is suitable for you and your circumstances and speak to a professional before making any financial decisions.
